2019: the year of ‘not another one’.
Retail space is display space. Not selling space.
It’s three years since British Home Stores went into administration. Three years, and so many signals that UK retail is not in a happy place, yet successive retail failures quickly followed. The demise of Toys ‘R’ Us and Maplins added to the signs that all was not well, but the reassuring voices of other major high-street names told us not to worry – they were on the case.
Long-standing brands are continuing to fall away, more quietly perhaps, but the rate of attrition is now established. This week, we learnt that Mothercare’s stores will follow Thomas Cook’s by soon vacating all their premises.
At the current rate, the UK is losing 110 retail stores per week from the ‘most popular town centres’, according to PwC. Sixteen a day. If you haven’t noticed yet, you’re either in a big city, or maybe you never had them in the first place.
Retail space is display space. Not selling space.
Shoppers are spoilt for choice when it comes to getting what they want at the cheapest-on-display price. Mothercare may have done a great job at displaying brands for parents -to-be to try, but why would they buy there?
The press accused Mothercare of being ‘expensive and grotty’ this week: neither of these things happens overnight. ‘Grotty’ happens when there isn’t enough money to refurbish, and ‘expensive’ happens when the competition has undercut you for so long that you need to sweat the maximum cash out of every sale.
Thomas Cook, apparently, hadn’t noticed that people don’t buy holidays from a brochure anymore. Maybe they’d never heard of Ceefax, let alone the internet. Mothercare didn’t understand its customers’ digital tendencies – or it chose to ignore them.
So, in the company of Jack Wills, Staples and Bonmarché, we’re likely to see another gap in the UK retail landscape this year.
Who loses?
You and me. I needed to buy a printer last week and I tried to do it by going to a store. It didn’t happen.
John Lewis was, frankly, atrocious. If customer service and a two-year guarantee are now their only USPs, I don’t see them surviving. Curry’s/PCWorld couldn’t sell me what I wanted and there just weren’t any alternatives. My town (@miltonkeynes) sits at the heart of the UK’s technology ‘Growth Arc’ and it seems more than a little ironic that basic products and services for the growing ‘technology’ population aren’t on sale.
As much as I hated to do it, necessity and convenience drove me to Amazon and my new printer arrived inside 48 hours.
Will this continue?
Should we expect more of the same? Should we get used to hearing ‘not another one’ when a high-street brand vanishes? Hell, yeah.
In the last month, we’ve met around eight SME businesses that won’t be in business in three years’ time. The signals of change are loud and clear, but the need to stay loyal to a founder’s vision has over-taken the acknowledgement of the blindingly obvious.
There’s even a networking business that has suspended one of its groups through a lack of interest. If ever there was a sign that grass-roots start-ups are pulling in their horns, this is it.
What are we doing about it?
It’s all very well sitting here and bleating about how bad things are, and how Amazon is taking over the world, but what is room44 doing about it?
Two things
Firstly, we’re diversifying and investing in a new activity stream. We’ve been writing about environmental matters for a long time and we’ve decided that we should do a bit more than talk the talk. We’re about to walk the walk as well (more about this later).
Secondly, we’ve built a product that will help companies, like yours, plan to outlast your competition and thrive in a tough market. It’s called 10, 20-30. Together we will build product launches to take you through the next decade and provide you with the tools to launch at least one per year, so you stay relevant in a changing market.
Because we take seriously our capacity to deliver quality, it’s only available to a limited number of clients. Take a look at the 10, 20-30 proposition here and get in touch if you’d like to know more.
Thanks for reading and, if we don’t speak, good luck.
Future thinking. Future-proofing. It’s what we do.